Entrepreneurial Orientation: A Theoretical and Empirical Examination of the Consequences of Differing Construct Representations

Abstract

abstract There has been much debate in the literature over the nature of the entrepreneurial orientation (EO) construct regarding its dimensionality and whether or not the dimensions of the construct are independent. This paper examines two different measurement models of the EO construct that have been put forth in the literature and describes the implications of each model with regard to these issues as well as their broader theoretical and practical implications for studies regarding EO. Finally, a Monte Carlo simulation shows that misspecification of the construct can inflate structural parameter estimates by over 240 per cent and critical ratios by up to 68 per cent, illustrating the threat to the statistical conclusion validity studies and emphasizing the importance of congruence between the theoretical definition of the construct and its measurement.